Several European countries have set up a new transaction channel that will allow companies to continue trading with Irandespite US sanctions. The announcement was made on Thursday.

The channel, set up by Germany, France and the UK, is called INSTEX — short for "Instrument in Support of Trade Exchanges."

"We're making clear that we didn't just talk about keeping the nuclear deal with Iran alive, but now we're creating a possibility to conduct business transactions," German Foreign Minister Heiko Maas told reporters Thursday after a meeting with European counterparts in Bucharest, Romania.

"This is a precondition for us to meet the obligations we entered into in order to demand from Iran that it doesn't begin military uranium enrichment," Heiko said.

The payment channel allows for European countries to continue trade with Iran but could put them on a collision course with Washington.